Domain names are traded in Vietnam, even though there is no legal framework for the business. The involved parties go ahead with sales because they say they cannot wait for the legal framework to be completed for transfer deals.

The Ministry of Information and Communication in 2008 released a circular on the management and use of internet resources, which lifted the ban on domain name trade and transfer. However, the circular was not enough to pave the way for this kind of business.

There are hundreds of domain name investors, individual and institutional, mostly in Hanoi and HCM City. Hanoi-based Micronet is one of the investors. It now owns 3,000 domain names and hopes to have an investment portfolio of 20,000 domain names by 2017.

The Vietnamese market is believed to have great potential for investors. Under current regulations, domain names cost tens or hundreds of thousand dong to register, and the same sums of money are needed to retain the domain name every year.

Meanwhile, investors can transfer the domain name for billions of dong if they can find suitable buyers.

BKAV, a well-known Vietnamese internet security solution firm, for example, had to spend VND2.3 billion in 2012 to buy www.bkav.com from an US company which registered the domain name before.

Potential market

According to the Vietnam Internet Network Information Center (VNNIC), only 20 percent of Vietnamese businesses have registered domain names.

Nguyen Minh Hong, director of the Quang Ninh Province’s Information Department, said at a recent workshop on domain names that 1,400 “.vn” domain names and more than 2,000 international domain names had been registered in the province.

The province had 11,800 businesses by the end of 2013.

“The figures showed that the number of Quang Ninh’s businesses with domain names remains modest. Meanwhile, in the digital era, e-commerce and internet-based ad activities have been developing so strongly,” Hong said.

The Ministry of Information and Communication said it was drafting a decree on auctioning and transferring usage rights of digital telecommunication repository and internet domain names.

An official of the ministry said the decree will clarify which kinds of domain names can be transferred.

The domain names with suffix “.vn” will be transferable, while transfer of domain names related to state agencies and socio-political organisations will be prohibited.

The decree will also show the procedures that involved parties need to follow to conduct domain name transfer deals.

Tran Minh Tan, Deputy Director of VNNIC, said the ministry is also compiling a circular guiding the management and use of internet resources.

Tan, analyzing the domain name market’s history, noted that the number of registered domain names rises sharply every time the policy is adjusted.

This shows that policies have a major impact on the development of the domain name market.